Lawmaker Wants Pot Growers, Sellers To Get License
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Lawmaker Wants Pot Growers, Sellers To Get License
Posted by CN Staff on February 03, 2010 at 17:03:58 PT
By The Associated Press 
Source: Associated Press
San Francisco -- A California lawmaker is proposing to require all marijuana growers and sellers to be licensed by the state as a way to increase sales tax revenue.Democratic state Sen. Ron Calderon said Wednesday he plans to introduce a bill requiring all legal and illegal marijuana businesses to register with the Board of Equalization, the state agency that collects sales tax. The bill would not legalize marijuana beyond current state law.
Supporters say the measure is intended mainly to provide a system of regulation for medical marijuana dispensaries. Such dispensaries already are required to pay sales tax like other businesses, but board vice chair Jerome Horton says many don't comply."There is a clear indication that many dispensaries are intentionally evading their taxes, distributing illegal products and may be laundering illegally acquired money," Horton said in a statement.Licensees would have to pay a fee, prepay part of the sales tax and pay an excise tax similar to manufacturers, distributors and retailers of tobacco products in the state.Calderon spokesman Rocky Rushing said the lawmaker estimates full compliance from legal medical marijuana sellers could generate $168 million in revenue.The Board of Equalization estimates that $1.3 billion worth of marijuana is sold legally in the state every year but only $8 million in sales tax are collected.Under the current tax code, medical marijuana dispensaries do not have the option of choosing marijuana sales as their primary business, making precise estimates of sales and taxes paid difficult.Medical marijuana advocates with the group Americans for Safe Access conducted their own study in 2007 that estimated dispensaries contribute closer to $100 million annually to state coffers.Americans for Safe Access spokesman Kris Hermes said that estimate was calculated when there were 400 dispensaries in the state, a figure that may have as much as tripled with the explosion in the number of dispensaries in Los Angeles.Hermes' group has long opposed the imposition of sales tax on medical marijuana, saying the drug should be treated like prescribed medications, which are not taxed.He said he did not see the need for additional tax laws regarding dispensaries, especially if new regulations required them to pay more than they already do."I don't know that a piece of legislation is necessary for dispensaries to pay sales tax since that's already a policy," Hermes said.The proposed legislation is modeled on a law crafted by Horton in 2003 that imposed tighter tax rules as a way to crack down on illegal cigarette sales. That law also provided the Board of Equalization with additional funding to enforce sales tax compliance.A 2006 report by the California State Auditor found that the cigarette law helped to stem a decline in cigarette sales tax revenue but said the board's own estimates of increased revenues owing to the law were overstated.Source: Associated Press (Wire)Published: February 3, 2010Copyright: 2010 The Associated PressURL: Medical Marijuana Archives
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Comment #6 posted by Christen-Mitchell on February 04, 2010 at 14:31:04 PT:
Pa -
It's them revenuers again
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Comment #5 posted by knightshade on February 04, 2010 at 05:53:51 PT:
am I reading this correctly?
"Democratic state Sen. Ron Calderon said Wednesday he plans to introduce a bill requiring all legal and illegal marijuana businesses to register with the Board of Equalization, the state agency that collects sales tax."So... they expect black market growers and street dealers to register and pay taxes?
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Comment #4 posted by FoM on February 03, 2010 at 19:20:45 PT
It will be interesting. It is getting to the breaking point where something will need to happen on a Federal level in my opinion.
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Comment #3 posted by Hope on February 03, 2010 at 19:13:47 PT
Comment 2 Los Angeles
That's going to be interesting.
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Comment #2 posted by FoM on February 03, 2010 at 18:29:46 PT
AP: LA Mayor Signs Medical Marijuana Shop Law
Wednesday, February 3, 2010 LOS ANGELES -- The mayor of Los Angeles has signed an ordinance that will close hundreds of medical marijuana shops and banish the rest to industrial areas.Mayor Antonio Villaraigosa signed the ordinance Wednesday, a week and a day after the city council approved the new law.The ordinance caps the number of dispensaries at 70 and creates a buffer zone around schools and places of worship. The city attorney's office says it will be at least 45 days before city officials can enforce the new rules. A letter will be sent to dispensary owners and landlords asking for immediate closure. If they don't comply, the city will likely seek an injunction. Copyright: 2010 Associated PressURL:
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Comment #1 posted by EAH on February 03, 2010 at 17:26:22 PT:
Piecemeal approach
One again half a brain creates a half assed proposal.This should add to the mountain of evidence that cannabis needs to be fully legalized. This will add cost that will be passed onto patients. The single biggest problem is that there remain no provisions to produce high quality cannabis in a normal lower cost way. Outside, organically, in soil, with sun, like pretty much all other agricultural products. Growing indoors is very expensive and uses vast amounts of energy, and isn't necessary. It only became popular because of prohibition. Notice even the most expensive California wineries don't grow grapes indoors. Lowering the cost to grow, will lower the cost to users. Cannabis could be pretty cheap, except for prohibition. Besides an excise tax needs to be levied
at the producer or wholesaler level. If it is medicine and medicine only then 
there should be no sales tax. If it is legal for general use then a sales tax would be acceptable, just like with alcohol and tobacco. The excise tax 
then needs to tax THC content. One tax fits all is ridiculous.
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